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Mallinckrodt (MNK) Financial Misrepresentation Case
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D. New JerseyCourt
- Mallinckrodt failed to pay interest payments on bonds and disclosed that may need to file for bankruptcy.
- $MNK share price fell 30%+
- Investors suspect Mallinckrodt & its Leaders of misleading & financial misrepresentation.
On June 15, 2023, Mallinckrodt (MNK) disclosed that it had determined not to make interest payments on two bonds due that day and may need to file for bankruptcy.
On this news, the $MNK share price fell 30.95%.
- On June 16, 2023, Mallinckrodt disclosed in an SEC filing that the Company and the Trust had agreed to extend the deadline for the Company’s $200 million payment to the Trust for the Opioid Settlement from June 16, 2023, to June 23, 2023, while reiterating that the Company may need to file for bankruptcy.
- On June 23, 2023, Mallinckrodt disclosed in an SEC filing that the Company and the Trust had again agreed to extend the deadline for the Company’s $200 million payment to the Trust from June 23, 2023, to June 30, 2023, while reiterating that the Company may still need to file for bankruptcy.
Earlier, on June 2, 2023, The Wall Street Journal reported that Mallinckrodt was again exploring bankruptcy as its next $200 million payment to the Trust for the Opioid Settlement came due.
On this news, $MNK share price fell 40%
Going back, in October 2020, Mallinckrodt filed for Chapter 11 bankruptcy protection while agreeing to settle its alleged role in the U.S. national opioid crisis for approximately $1.7 billion.
- As part of its Chapter 11 exit plan, Mallinckrodt agreed to make nine payments over eight years to an opioid-victims compensation trust for the Opioid Settlement.
- The Company made its first payment of $450 million to the Trust as it emerged from Chapter 11 bankruptcy protection in June 2022.
- The Company’s next payment of $200 million was due to the Trust in June 2023.
Despite its ongoing financial obligations to the Trust for the Opioid Settlement, since emerging from Chapter 11 bankruptcy protection, Mallinckrodt has repeatedly assured investors of the Company’s financial strength, including purported enhancements to its liquidity and balance sheet, as well as its overall prospects for continued financial stability and near- and long-term success.
Taking all facts into account, Investors have reasons to suspect Mallinckrodt & its Leaders of misleading and financial misrepresentation.
Failure to Disclose,
Shock Event Date
15 June 2023
05 July 2023
Lead Plaintiff Deadline
05 September 2023
Hon. Zahid N. Quraishi
23 August 2023
$MNK Important News:
- Mallinckrodt disclosed plans to file for bankruptcy in the near days.
- $MNK said it is reaching an agreement over the restructuring deal with creditors.
28 August 2023
$MNK Case-related News:
Mallinckrodt $MNK filed a Chapter 11 case in an attempt to wipe out its $1.9 billion of secured debt.
31 August 2023
$MNK case-related News:
Mallinckrodt PLC received permission in Delaware bankruptcy court to tap into $250 million of Chapter 11 financing after the judge presiding over the case had his concerns about large fees owed to the lenders addressed by the debtor.
07 September 2023
$MNK Case Update:
- Two investors have requested a New Jersey federal judge to appoint Pomerantz LLP as the lead counsel in their lawsuit.
- In this lawsuit, they allege that $MNK misled shareholders by creating a false impression of financial recovery from bankruptcy and the ability to contribute $200 million to an opioid fund.
12 September 2023
$MNK case-related News:
- The city of Rockford, Illinois, is urging two law firms representing pharmacy benefits manager Express Scripts and drug manufacturer Mallinckrodt PLC in antitrust litigation and a connected bankruptcy case to respond to subpoenas issued by the city.
- These subpoenas are related to contested contractual documents pertaining to the alleged price-fixing of a seizure medication.
21 September 2023
- In a Delaware bankruptcy court, Mallinckrodt got the green light for $250 million in Chapter 11 financing from its lenders before the bankruptcy.
- This happened even though one creditor had raised concerns about bonuses for $MNK management team.
22 September 2023
- A New Jersey federal judge appointed Pomerantz LLP as the lead counsel in a lawsuit.
- This lawsuit alleges that the financially troubled $MNK deceived investors by creating a false impression of emerging from bankruptcy and committing to a $200 million payment to an opioid fund.
28 September 2023
Chapter 11 Plan Oppositon
- Secured creditors and Mallinckrodt shareholders urge a Delaware bankruptcy judge to oppose the $MNK revised Chapter 11 plan.
- They claim it favors unsecured opioid claimants and corporate directors at their expense.